 Who drove the boom in euro-denominated bond issues?Galina Hale and Mark Spiegel No 2008-20, Working Paper Series from Federal Reserve Bank of San Francisco Abstract: We make use of micro-level data for over 45,000 private bonds issued by over 5000 firms from 22 countries in 1990-2006 to analyze the impact that the launch of the EMU had on the currency denomination of the bond issues. To our knowledge, ours is the first systematic analysis of issue at the micro level. The use of the micro data allows us to distinguish between the response to the advent of the euro by new and seasoned bond issuers, and to condition on other issue characteristics. We find that the impact on new issuers is larger than on seasoned issuers and that most of the increase in the euro-denominated bond issuance was along the \"extensive\" margin. Insofar as new entrants to the bond market will define the overall currency composition in the long run, these results imply that aggregate studies might be underestimating the euro effect. We also find that to a large extent the increase in euro issuance was \"at the expense\" of U.S. dollar issuance, suggesting that the euro competes with the U.S. dollar as a currency of choice for international financial transactions. Keywords: bond markets; Euro (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:fip:fedfwp:2008-20 Ordering information: This working paper can be ordered from Access Statistics for this paper More papers in Working Paper Series from Federal Reserve Bank of San Francisco Contact information at EDIRC. |
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